Policy Uncertainty Drove Low Conviction Views Across Asset Classes, Triggering A Shift To Gold
NEW YORK, April 28, 2025 (GLOBE NEWSWIRE) — Unlimited, an asset management firm and ETF sponsor that uses proprietary technology to provide low-cost, alternative strategies to a variety of investors, today published its Q1 2025 Hedge Fund Barometer, which showed a significant reversal of pro-growth positions in both U.S. equities and corporate bonds over the quarter as well as an increase in bets on gold.
According to Unlimited’s proprietary technology, hedge fund managers came into the year with relatively low conviction and modest views but subsequently ramped up pro-growth positions including long the U.S. dollar, and credit spread and equity bets in line with increased expectations of U.S. growth from the new administration. The majority of those positions were reversed starting in February with the exception of extending bullish positions on gold.
“Hedge fund positioning shows some of the lowest conviction in the direction of asset prices that we have seen in decades,” said Bob Elliott, CEO and CIO of Unlimited and portfolio manager of actively-managed ETFs. “Those positions were a dramatic transition from the beginning of the quarter when hedge funds were ramping up their bullish bets on the U.S. economy. The prominence of policy volatility likely triggered managers’ reluctance to hold significant directional positions.”
Hedge funds eked out modestly positive performance in the first quarter with the mix of sub-strategy returns largely reversing the moves of the previous quarter. Emerging Market funds outperformed meaningfully as Chinese stocks surged meanwhile Equity Long/Short and Event Driven strategies came in weak.
1Q25 Hedge Fund Strategy Performance, Gross of Fees
- Industry Return: 1.7%
- Best Performing Fund Style: Emerging Markets 6.3%
- Worst Performing Fund Style: Event Driven -0.8%
Unlimited’s Hedge Fund Barometer showed other notable moves during the quarter included:
- Bearish outlook on oil shifted towards neutral bullish positioning in Chinese and Japanese equities
- Notable underweight in U.S. biotech
- Equity Long/Short managers remain bearish on U.S. small and mid-cap companies
Click here to view a video on how Unlimited’s technology works.
About Unlimited
Founded in 2022 by Bob Elliott, Bruce McNevin and Matt Salzberg, Unlimited is an investment firm using proprietary technology to create strategies that offer lower-cost access to 2 & 20-style alternative investment strategies, such as hedge funds, to a wide variety of investors. Mr. Elliott has built innovative hedge fund strategies for more than two decades, including at Bridgewater Associates, the world’s largest hedge fund. Mr. McNevin is a Professor of Economics at New York University and has held various data science positions at hedge funds Clinton Group and Midway Group, along with positions at Bank of America and BlackRock. Mr. Salzberg serves as a Managing Partner at Material and Board Director of Unlimited. Learn more at unlimitedfunds.com.
For informational and educational purposes only and should not be construed as investment advice. The data shown herein represents past performance and should not be construed as providing any assurance or guarantee as to returns that may be realized in the future. No representation is being made that any investment will or is likely to achieve profits or losses similar to those shown herein. No investment strategy or risk management technique can guarantee return or eliminate risk in any market environment.
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